Standing Committee B

[Mr. Peter Pike in the Chair]

Gambling Bill

Schedule 8 - Family Entertainment CentreGaming Machine Permits

Amendment made: No. 171, in schedule 8, page 163, line 16, at end insert 
'except that, in paragraph 5(d) it means, where the application is made to a licensing authority in Scotland, prescribed by regulations made by the Scottish Ministers.'.—[Mr. Caborn]

Malcolm Moss: I beg to move amendment No. 311, in schedule 8, page 163, line 38, leave out 'may' and insert
'shall, after consultation with— 
(a) one or more persons who appear to represent local authorities, 
(b) one or more persons who appear to represent chief constables of police forces, 
(c) one or more persons who appear to represent the interests of persons carrying on relevant gambling businesses which will be affected, 
(d) one or more persons who have knowledge about social problems relating to gambling, 
(e) to such extent and in such manner as appropriate, members of the public,'.

Peter Pike: With this it will be convenient to discuss the following amendments:
No. 312, in schedule 8, page 163, line 39, leave out 'propose to' and insert 'shall'. 
No. 313, in schedule 8, page 163, line 40, leave out 'may' and insert 'shall'. 
No. 314, in schedule 8, page 164, line 2, leave out 
'need not (but may) have regard to' 
and insert 'shall follow'. 
No. 315, in schedule 8, page 164, line 3, leave out 'have regard to' and insert 'follow'. 
No. 320, in schedule 11, page 189, line 19, leave out 
'need not (but may) have regard to' 
and insert 'shall comply with'. 
No. 321, in schedule 11, page 189, line 20, leave out 'shall have regard to' and insert 'shall comply with'. 
No. 322, in schedule 11, page 189, line 21, at end insert— 
'(4) The licensing authority shall ensure that the statement of principles does not in any way conflict with the licensing objectives or guidance issued by the Commission.'.

Malcolm Moss: Welcome back to the Chair, Mr. Pike. Amendment No. 311 lists the parties that we think ought to be involved in the consultation before the licensing authority prepares its statement of principles to apply when exercising its functions under the  schedule. Those whom we think ought to be involved include
''one or more persons who appear to represent local authorities'',
which would probably include some local councillors. The best people would be members or representatives of the licensing committee. We also think that the following people should be involved: 
''one or more persons who appear to represent chief constables of police forces''—
in other words, some of the local police; 
''one or more persons who appear to represent the interests of persons carrying on relevant gambling businesses which will be affected'',
which is straightforward; 
''one or more persons who have knowledge about social problems relating to gambling'';
and finally 
''to such extent and in such manner as appropriate, members of the public''.
As I said, we have included, in sub-paragraph (1)(d), people who have knowledge about social problems relating to gambling. We have been approached by representatives of Churches and groups who think that they ought to have an input at some stage, particularly at a local level, on how the matters will impact on protection of young people and the vulnerable. Before the statement of principles is formulated, full consultation ought to take place with all those people referred to in the amendment. 
Amendment No. 312 would replace the words ''propose to'' in line 39 with ''shall'', and amendment No. 313 would replace ''may'' in line 40 with ''shall''. It is critical that the basis on which decisions about applications are made is clearly set out and unambiguous. That will enable applicants to understand what is required of them in order to comply with their permits. Let us remind ourselves that any breach of that permit would make an individual liable to conviction of an offence under clause 30, without defence. It is essential that the requirements are set out clearly in the Bill not only for that reason, but to achieve compliance with the Human Rights Act 1998 and the European convention on human rights. In addition, the Budd report specified that the principles under which local authorities should act should be set down unambiguously to ensure uniformity and consistency of regulation. Those safeguards should be enshrined in the Bill. 
Amendments Nos. 314 and 315 would also firm up the words in the Bill. Sub-paragraph (3) states: 
''In exercising their functions under this Schedule a licensing authority—
(a) need not (but may) have regard to the licensing objectives''.
That is far too sloppy and weak. By taking out the words 
''need not (but may) have regard to''
and replacing them with ''shall follow'', amendment No. 314 would leave us with a clear statement of intent, which would strengthen the Bill. We feel that if the licensing objectives are important, the licensing  authority ought to take them into account in issuing permits. 
Amendments Nos. 320 and 321 are consequential amendments which would take the same wording and replace it with the words ''shall follow'' in schedule 11. I need not deal with that any further. Amendment No. 322, which again relates to schedule 11, would insert a new sub-paragraph (4), which reads: 
''The licensing authority shall ensure that the statement of principles does not in any way conflict with the licensing objectives or guidance issued by the Commission.''
We would expect common sense to prevail in such matters, and licensing authorities should not do anything contrary to the gambling commission's views, but including the requirement in the Bill would make it clear and unambiguous that nothing that the licensing authority does in relation to the permits should run counter to the clear aims of the commission.

Richard Page: You may recall, Mr. Pike, that during our last sitting I spent a little time going through all the ''mays'' that would allow the Secretary of State to introduce regulations. I said at the time:
''I do not know why we are even bothering to debate the Bill. Why does the Bill not simply say, 'The Secretary of State may, by regulation, determine what is going to happen'? Then we could all go home.''—[Official Report, Standing Committee B, 7 December 2004; c. 448]
It appears that this malaise is catching because the Government now want to introduce ''may'' back into the provisions relating to the licensing authority—the licensing authority ''may'' prepare a statement of principles. I agree with my hon. Friend the Member for North-East Cambridgeshire (Mr. Moss) that that uncertainty should be completely removed from this part of the Bill. Surely one of its most important aspects is to ensure correct and proper licensing. We need to see exactly how it will all operate, not whether the authority ''may'' draw up a statement of principles. 
Earlier on in the Committee's deliberations, my hon. Friend the Member for Surrey Heath (Mr. Hawkins) spent some time on the question of rowdy clubs in Guildford. He pressed the matter to a Division, in which the Government were not minded to vote with him. I have a great deal of sympathy with my hon. Friend because I know that particular stretch of high street, which has a string of clubs, and on Friday or Saturday nights it can be very ''exciting''—the police are frequently present. My hon. Friend asked what would happen if one of those clubs were to apply for a licence to run a casino. 
The bodies that my hon. Friend the Member for North-East Cambridgeshire has detailed in amendment No. 311 should be consulted so that it is clearly understood that the licensing of any casino has been checked and vetted by all the bodies with an interest in ensuring that it is a proper and fitting place in which to run such an operation. My hon. Friend was very good about not wanting to take up too much of the Committee's time, so he did not go through each of the individual bodies and their relevance. 
However, we all know that if a local councillor is worth their salt, they will know what is going on in  their area and will know the places that look likely to apply for licences. Surely to goodness they should be consulted. Surely the police, too, should be consulted. They are in the area, they know the type of people who go to the various places and, probably, whether those making the application are fit and proper people to hold a licence. It is only right, too, that those who understand the social problems relating to gambling should be involved in the licensing of any gambling establishment. Those of us on the scrutiny Committee visited GamCare and other organisations interested in and concerned with the social problems caused by gambling. Surely those people should be consulted on whether an establishment is the right and proper place to be given a licence. 
Turning to the issue of fair play, those people who are interested in gambling should be consulted on whether the application that is being made is proper and whether it is being correctly treated. 
When one considers the whole body of opinion that should be consulted, it is absolutely right that we should change the word in the clause from ''may'' to ''shall''. That way everyone would know where they stand. I do not say to the Minister that every one of the phraseologies and titles in my hon. Friend's amendment is perfect. The Minister may wish to shave them and produce a more polished wording; nevertheless, it is absolutely right that a licensing authority ''shall'' prepare a statement of principles. My hon. Friend has done an excellent job in preparing the basis of such a statement of principles. I look forward to hearing what the Minister has to say on the subject.

Julie Kirkbride: I join my hon. Friends in encouraging the Minister to take the amendment seriously.
In their defence of the Bill when introducing it, the Government made a great deal of the right of local communities to exercise influence, or even control, over the gambling that takes place in their area. Much has been said in earlier debates about the so-called triple lock mechanism. When the Bill in its original, wholly free market state was to allow gambling to take place anywhere there was demand for it, the only thing that the Government could say in defence of their plans was that, while there would a market-driven mechanism, local communities could say that they did not want gambling to take place in their area and the triple lock mechanism would ensure that those who did not want it had the right to say no. 
That is important because I am sure that there will be many areas—I hope that mine will be one of them—that are not enthusiastic about the proposals. Even if there were areas that wanted some form of gambling, I think that local people would want to take control of what kind of gambling that would be. Therefore, the idea that there should be a statement of principles set out by the local authority which is binding rather than consultative—and does not adopt a ''take it if you like and don't if you don't'' approach—is entirely right. I am shocked that the Government have been so mealy-mouthed in schedule 8 about what local authorities must do when an  application for permission for a gambling premises is made in their area. 
For example, the idea that a 
''licensing authority may prepare a statement of principles that they propose to apply'',
is clearly far too subjective and indecisive. That provision could be ignored, given that the law will not insist that it ''shall'', as set out in the amendment. Given that many local people will want to have a say, I hope that a statement of principles shall be exercised, so that when the go-ahead is given for gambling in a particular area, local people know what framework it will have, that it is sacrosanct and that it is not a question that the statement ''may'' fit in with local principles but that it will. 
Equally, I hope that the Minister will take on board amendment No. 311, whereby instead of stating that those authorities that need to be consulted ''may'' be consulted, it is stated that they ''shall'' be consulted. If there is a statement of principles and the amendment is agreed to, the relevant authorities must be consulted to establish whether the statement has been adhered to. 
Debating an amendment last week about whether local authorities should be allowed to take money from casinos to provide local services, the Minister was vigorous in his defence of the right of local councillors to make difficult decisions. I argued that such provision should be set out in law rather than left to local discretion. The Minister said, however, that councillors should decide such things, because they have the wherewithal to do so, and that he would therefore resist the amendment. If we are to give local councillors such power, they should be consulted about the licensing authority's statement of principles and about any potential modification of that statement, where an application seems to fly in the face of the original statement set out when permission to locate gambling premises in that area was first applied for. 
Local councillors should, or, as in our amendment, shall be consulted. That is important, but equally important is the attitude of local police, because one concern that we have with this legislation is its potential to create more criminal activity in our communities. There is a big question mark over gaming activities elsewhere in the world. They pull in a criminal element, because such activities are a potential means of laundering money. The views of local police are important when it comes to the organisation of a statement of principles about the way in which the licensing of any one authority should be applied. Local chief constables should be consulted. If there is a worry that gambling is attracting criminal activity in a certain area, they will want to be consulted on any extension, because giving the go-ahead for more gambling premises will only inflame the situation. It is important to allow chief constables or a representative of the police force to take a view. 
To be fair to those who already have a gambling business locally, the legislation should state that they  ''should'' be consulted rather than that they ''may'' be consulted, because competition in the area will affect their business. They should not have a binding say, but they should be entitled to a say and it is only right that their views ''should'' be solicited rather than ''may'' be solicited. Gambling is controlled by legislation. It is not like a shop in the High street. It is a more restricted activity and the state seeks to interfere in the market. Gambling premises exist because statute rather than the market allows them to do so, so the operators should be consulted, although I would not give their interests the same weight as those of local councillors or chief constables. 
Many people in the area will be affected by the consequences of the Government's proposal to extend gambling. My concern is that even the Government's more modest proposal for 12 regional casinos will unleash a gambling problem in those areas because they will be situated in large population centres. Those people who deal with the ensuing social problems should have a say on any application for additional gambling premises and how that affects the statement of principles that was set out by the licensing authority when the premises were first allowed in that locality. That is important if the Government are serious about keeping the lid on problem gambling. I hope that the Government will firm up schedule 8. That would not be a major concession, but it would be a reasonable one. 
I particularly hope that the Minister will consider our amendment to paragraph 7(3), which states: 
''In exercising their functions under this Schedule a licensing authority—
(a) need not (but may) have regard to the licensing objectives''.
That is an extraordinary statement to put in a schedule. It obviates the point of a schedule if people can do something if they want to, but do not have to if they do not want to. If people are to have confidence in the licensing authority's powers and relevance, due process needs to have taken place before applications are considered and given the go-ahead. To provide such an overwhelming catch-all that if people do not want to do something they need not bother to do it would weaken considerably the control of the community and those whose interests are affected over the roll-out of gambling in an area. 
I hope that the Minister will listen to what I have said and that he will not take offence when I leave the Committee shortly to see my little man's nativity play. I may not hear the Minister's response and I hope that the Committee will forgive me for that unintended offence.

Richard Page: On a point of order, Mr. Pike. During my brief contribution earlier, I referred to a licensing authority and that it ''shall'' prepare a statement of principle. I might have referred to the licensing of casinos when I meant the licensing of gaming machine permits. I did not mean casinos and I might have misled the Committee.

Peter Pike: That is a point of correction and not a point of order, but the Committee has noted it.

Richard Caborn: We have had an interesting debate this  morning. Does schedule 8 comply with the Human Rights Act? The answer is yes. None of the amendments is needed to achieve human rights compatibility. The authority is always under an obligation to comply with human rights legislation.
I ask the hon. Member for Bromsgrove (Miss Kirkbride) in particular to reflect on discussions earlier this week about family entertainment centres and the great defence that was put up for them—and rightly so, as they are a very important part of our seaside resorts particularly. Schedule 8 expands on clause 231 on family entertainment centre gaming machine permits. This is about category D machines. Money laundering has been mentioned, but I cannot imagine the Kray twins putting 10p pieces into category D machines for such purposes. In response to all the speeches about licensing we have said that we want a light touch for family entertainment centres. The very clear message from the Opposition was that they wanted to allow these family entertainment centres to continue in the way that they have done. 
All we are doing is enshrining the provisions of the Gaming Act 1968 in the Bill. I have not seen money laundering through category D machines or in family entertainment centres in the recent past. I have not seen the disruption of family entertainment centres that has been described in support of the amendment. Schedule 8 is about family entertainment centre machine permits. It is specifically about category D machines—10p stakes, £5 payout. We want to bring them under the licensing regime by providing for permits. Why permits? That is because we want a light touch for family entertainment centres. We do not believe that they have been centres of unrest or of money laundering, although from the contributions this morning anyone would think so.

Malcolm Moss: I am grateful to the Minister for his explanation of what we are dealing with. There was nothing in what I said to suggest that I did not understand what I was proposing—for the record. Any criticism that fired across the Committee should not have been aimed in my direction.
Yes we are dealing with unlicensed premises. The Bill states categorically that if one has a premises licence one does not need to go through the requirements of schedule 8. I understand that, but what is the difference between such an unlicensed place getting a permit for some machines and fish and chip shops—apart from the fact that they sell fish and chips as the primary source of income?

Richard Caborn: I will explain. The hon. Gentleman put forward logical and not emotive arguments, and it is true that the amendments are about the procedure for obtaining permits for family entertainment centre permits, but I am afraid that we cannot agree with them. They would place an additional and unnecessary strain on the licensing authority without adding any benefit to the way in which it carries out its function in respect of family entertainment centres.
Family entertainment centres with such permits are, of course, those that offer only category D machines—the type that children can play. Many of our seaside resorts offer such facilities. Schedule 8 is intended to  give the licensing authority the discretion to take into account local circumstances when considering whether to issue a permit. In doing that, the authority needs to take account of the relevant guidance from the commission and it can consider the licensing objectives in its judgment. Licensing authorities should be given discretion over the granting of permits, and that is what happens under the current law. The 1968 Act enshrines that. 
The authority understands the local environment in which the premises and machines will be operating. Therefore, it is in the best position to judge whether the application merits a permit. If the local authority acts irrationally, public law remedies will be available to stop it making a perverse decision. However, we must retain discretion for the local licensing authority. 
The hon. Gentleman will note that there is an obligation on the authority to consult the local police before granting a permit under paragraph 9(b). We believe that that is the appropriate level of consultation for the permits. If we make the provision for a permit excessive, we might just as well require that FECs hold an operating licence from the commission and we do not want to do that. I am sure that we would all agree that that would be disproportionate to what we are trying to achieve in respect of category D machine family entertainment centres. 
I turn to the amendments that have been tabled in respect of prize gaming permits under schedule 11. I understand the motives behind them, but I do not think that they would assist licensing authorities or applicants. As with FEC permits, the licensing authority should have discretion to grant permits, as it does now under the Lotteries and Amusements Act 1976. An attempt to curtail that discretion would not add anything to the Bill. Amendment No. 322 covers an additional suggestion, which is that the statement of principles produced by the authority must not conflict with the licensing objectives or the commission's guidance. I assure the hon. Gentleman that it will be open to the authority to produce a statement that conflicts with the commission's guidance.

Malcolm Moss: I wish to make sure for the record that the Minister should have said that the local authority will not be able to—

Richard Caborn: I am sorry. For the record, then, it would not be open to the authority to produce a statement that conflicts with the commission's guidance.
It is open to authorities to take account of the objectives. However, as I have just explained, authorities should not be constrained about the matters that they take into account when making decisions about permits. By having the permit, FECs and fish and chip shops have arrangements for supervision of the machines. Given my explanation, I hope that the hon. Gentleman will withdraw the amendment.

Malcolm Moss: I am grateful to the Minister for his explanation and clarification of one or two key issues. We have no real problem with there being a light touch. The least regulation that we can get away with, the better for all concerned. However, I wonder why paragraph 7(1) gives the licensing authority the discretion to prepare a statement of principles. The Minister said that such a provision was lifted from the 1968 Act, or was it the 1976 Act?

Richard Caborn: It is the 1976 Act.

Malcolm Moss: Fine.
If there is to be a light touch, why do we need the provision? Does the Minister have any idea how many licensing authorities have a statement of principles? Would the provision apply in areas with a large number of family entertainment centres, such as seaside towns and resorts where the local authority might like to make it clear that, to maintain its overall standards, it had laid down principles and expected those who applied for permits to meet the requirements in their operations? If we want deregulation, why do we need to bother even stating that a local authority may, if it so chooses, prepare a statement of principles? I should be grateful to the Minister if he could answer that point.

Richard Caborn: I shall try to do so. Under clause 327, a licensing authority has to make a general statement. Paragraph 7(1) is an additional tool to that end under schedule 8.

Malcolm Moss: I follow the logic. Perhaps we should have tabled an amendment to clause 327. If the principle is right—that there needs to be such a provision—that is fine, but what if the principle, given the light touch, is that we do not need to be too fussed about the statement of principles? Behind my question was the issue of whether such statements are important. How many will be made? How many authorities will bother to make them? What is the purpose behind the provision? The Minister cannot just say, ''Well, it is in clause 327, therefore it follows that it must be in schedule 8.'' It may be wrong in principle wherever it occurs in the Bill. What is the experience? Why do the Government think that the provision ought to be included in this part of the Bill?

Richard Caborn: Clause 327 deals with three-year licensing policy. We are not saying that an authority has to make a statement of principles under schedule 8, but that it may. It is about getting the right balance. The provision gives the opportunity to extend the licensing requirements in clause 327, and such a statement may add strength. It is an opportunity for the authority.

Malcolm Moss: I am listening carefully to the Minister and I am with him as far as he goes. Let us take the example of a local authority such as Blackpool. An operator may have several family entertainment centres in Blackpool and a number of them in Southport, just down the road. The respective licensing authorities in Blackpool and Southport may take completely different approaches in this context. One might say, ''We have these principles, to which we must adhere'', and the other might not bother. 
In the interests of consistency, so that small businesses know where they stand, why do we need to include the provision? If it is important, it should be included, but if it is not that important, I do not see the point of including it. I do not want to thrash this to death, but I do not think that the Minister has answered that. If he wants to reflect on it and return to it later, I would be more than happy for him to do so. Operators of more than one premises ought to know where they stand across the board, rather than their having to deal with different situations in different jurisdictions. That is my point.

Richard Caborn: Different conditions may prevail in different areas and an authority might want to take such actions. However, both authorities would need to issue a statement on licensing under clause 327 anyway. Different conditions may prevail and we want to give authorities flexibility to make a statement if they find it helpful. I do not believe that that is wrong. We are bringing licensing much more into local authorities' remit.
To digress for a moment, I met representatives of the Local Government Authority yesterday to discuss a number of issues, one of which was the question of licensing and how the regulations would be policed. We will have to revisit that; we need flexibility on one hand and consistency on the other—I accept that. We also need far better operation of the regulations at local authority level, and we will be discussing that with the LGA. We are consistent: we have provided for flexibility but the broad principles will be outlined under clause 327. If different conditions prevail in different areas, the authority has the flexibility to act accordingly.

Malcolm Moss: I am still not absolutely sold on the idea, but I am not going to divide the Committee on it. Nevertheless, we ought to reflect on it.
Given the financial pressures on local authorities, I envisage that most will not make such a statement if they do not have to do so. Therefore, the question remains hanging in the air as to why anyone would want to set down a set of principles about family entertainment centres—we are talking about the unlicensed ones, not the licensed ones with the premises licences. I do not think that local authorities will bother very much about doing that; very few will do it. I wonder why it would be done in the first instance. What would a local authority wish to establish in monitoring the operation of such establishments? 
I beg to ask leave to withdraw the amendment. 
Amendment, by leave, withdrawn.

Malcolm Moss: I beg to move amendment No. 316, in schedule 8, page 164, line 26, after 'make', insert 'at the applicant's option'.

Peter Pike: With this it will be convenient to discuss amendment No. 323, in schedule 11, page 189, line 41, after 'applicant', insert ',at the applicant's option,'.

Malcolm Moss: This minor amendment relates to schedule 8, paragraph 10(2), which states that
''A licensing authority may satisfy sub-paragraph (1)(b)''—
that sub-paragraph is about the application for a permit for the machines— 
''by giving the applicant an opportunity to make—
(a) oral representations
(b) written representations, or
(c) both.''
The words ''at the applicant's option'' should be inserted to make it absolutely clear that the applicant has a choice. He or she could then say, ''I choose to do A'' or, ''I choose to do B.'' Oral representations would be easier to make, could be made on the telephone or in a face-to-face interview, and would not require applicants to sit at their computers to type something out. The amendment is minor, and designed to reinforce what I think is behind the wording of the Government's sub-paragraph anyway: the notion of giving a certain amount of choice. The amendment would just firm that up.

Richard Caborn: I have some sympathy with the amendment. The hon. Gentleman wants to ensure that applicants are able to have their say, as is absolutely right, if an authority proposes to turn down an application. We want that too, and the paragraph already gives all applicants the right to be heard in those circumstances.
However, in our view the authorities need some discretion over what form representations should take. In exercising discretion, authorities will have to consider the rules of natural justice anyway. In some circumstances an applicant may well be able to make his case effectively in writing, without any damage being done to the fairness of the proceedings. Therefore, we want the assessment to be carried out by the authority, which will be in possession of all the facts relating to each application. The authority will be able best to determine whether an oral hearing or written submissions are appropriate. Therefore, I am afraid that I cannot agree with the amendment. 
The same has to be said about amendment No. 323. As it stands, the Bill would treat all applicants fairly and give them the necessary rights. I hope that, on that basis, the hon. Gentleman will feel able to withdraw his amendment.

Malcolm Moss: I am grateful to the Minister for his explanation. An applicant may—dare I say it—not be terribly literate or capable of a making written submission, even though they are running an extremely profitable and sound business. As I understand the paragraph, the local authority has discretion, as the Minister rightly said, in determining what form of representation the applicant should make. In very rare circumstances, an applicant might be embarrassed at having to submit a written application. Getting that done by someone else might cost extra money, but the applicant would be more than able to give an oral representation in support of their application.
I do not intend to press the amendment to a Division, but there may well be circumstances in which, in the interests of natural justice, the applicant should be given the benefit of the doubt and be able to  choose. In the light of what the Minister said, I beg to ask leave to withdraw the amendment. 
Amendment, by leave, withdrawn.

Malcolm Moss: I beg to move amendment No. 317, in schedule 8, page 166, line 32, at end insert
'and there has been a material change in circumstance since the original granting of the permit'. 
The amendment relates to paragraph 18(4)(b) of schedule 8, which deals with the renewals of permits for gaming machines and contains the second ground for refusal— 
''that renewal would not be reasonably consistent with pursuit of the licensing objectives.''
Our amendment would add to that the words 
''and there has been a material change in circumstance since the original granting of the permit.''
It is felt that there should be a presumption that provided that an application has been granted initially, the circumstances when the initial grant was made should be deemed to be consistent with the licensing objectives. It could be inequitable if a licensing authority were entitled to re-interpret the same set of circumstances and judged them to be inconsistent with the licensing objectives. We are attempting with our amendment to clarify that situation should it arise.

Richard Caborn: I appreciate that the hon. Gentleman is trying to give some extra reassurance to the amusement machines industry. We have already agreed, in earlier proceedings, that family entertainment centres throughout the country are well run and offer real entertainment for families. No doubt the vast majority of family arcades will never cause concerns that might give the licensing authority reason to refuse the renewal of their permit. However, paragraph 18(4) allows for those unusual circumstances where the FEC was no longer run responsibly. In such circumstances it is right to refuse renewal.
The grounds for refusal are clear. The licensing authority has to provide evidence that allowing the FEC to continue operating will involve some threat to the licensing objectives. Not only are those grounds clear, they are constrained. The authority cannot refuse to renew a permit on a whim or fancy. 
A case that might merit refusal could, for example, be based on evidence that the permit holder was encouraging children to play machines excessively, perhaps during school hours. Such evidence would have to involve a material change in the circumstances since the time of the application, otherwise the permit would not have been granted in the first place. 
I hope that with that explanation the hon. Gentleman will withdraw his amendment.

Malcolm Moss: I am grateful to the Minister for that explanation, on the basis of which I beg to ask leave to withdraw the amendment.
 Amendment, by leave, withdrawn. 
Question proposed, That this schedule, as amended, be the Eighth schedule to the Bill.

Malcolm Moss: Under paragraph 12—''Duration''—permits are effectively handed out for a 10-year period. I should like clarification that that is replicating the existing period under the Gaming Act 1968 and the Lotteries and Amusements Act 1976.
Paragraph 15 deals with the lapsing of a permit. The words 
''A permit held by an individual shall lapse if . . . he dies''
or she dies, are fine, but sub-paragraph (2) says: 
''In any other case a permit shall lapse if the holder—ceases to exist''.
I am not sure what that means. Why not ''dies''? Of course, the holder might be a company. I should like clarification that that is what the Minister was alluding to.

Richard Caborn: Yes, 10 years, but it can be longer. The current minimum is three years, but it can also be longer. The phrase ''ceases to exist'' covers companies, not individuals.
Question put and agreed to. 
Schedule 8, as amended, agreed to.

Clause 232 - No prize

Question proposed, That the clause stand part of the Bill.

Malcolm Moss: I have a quick comment. The clause deals with no prizes, and states that:
''A person does not commit an offence under section 34 or 226 if—
''(a) he makes a gaming machine available for use by an individual, and
(b) the individual does not, by using the machine, acquire an opportunity to win a prize.''
Clause 34 deals with providing facilities or premises for gambling of one kind or another, and clause 226 deals with making a machine available for use. I cannot think of a situation where clause 232 might pertain, and I would be interested to know what it deals with, and why a clause of this nature is necessary.

Richard Caborn: I think the relevant game would be pinball machines.
Question put and agreed to. 
Clause 232 ordered to stand part of the Bill. 
Clause 233 ordered to stand part of the Bill.

Clause 234 - Single-machine supply and maintenance permits

Question proposed, That the clause stand part of the Bill.

Malcolm Moss: I have another couple of quick questions. Subsection (3)(e) states that an application for machine supply and maintenance permits must
''be accompanied by the prescribed fee'',
and a later subsection states that the Secretary of State will set those prescribed fees by regulations. Under existing legislation, are fees required, and if so what is the order of those fees, or are we introducing new fees here—is this a new concept, and a new charge on  businesses? If these fees are new fees to be set down by the Secretary of State by regulations at some future date, do the Government have any idea of what the scale will be of these fees that will be required to accompany the application? 
I am also a bit confused about subsection (6). We have just been talking about permits for up to 10 years, and possibly three years in the main, and yet subsection (6)(a) refers to 
''a period, not exceeding one year, during which it has effect''.
Perhaps I have missed something, but I am puzzled about that reference to one year, when elsewhere we are talking about permits for three years and 10 years.

Richard Caborn: I shall give an explanation of the clause first, as that might give my officials time to find the answer to the hon. Gentleman's questions. I hope he will bear with me.
The clause provides a special permit procedure for people who want to supply, repair, install or maintain a single gaming machine, not as part of a commercial gaming machine business but, for example, because they collect antique machines. The clause sets out the details of how the application can be made to the gambling commission. 
The commission may grant an application only if it is satisfied that the licensing objectives are irrelevant to the activity for which the permit is sought. That replicates permits that are currently issued by the Gaming Board to individuals outside the gambling industry who have single machines that they wish to dispose of or repair. That appears to work without any problems, so we have preserved it in the Bill. It would be an entirely unnecessary regulatory burden to force people with a single machine to apply for an operating licence. 
I will now address the hon. Gentleman's questions. Yes, fees are required; this is not a new concept. However, collectors of antique machines will not be charged, but that exemption will not affect many people. 
The hon. Gentleman's last point was about fees.

Malcolm Moss: It was on dealing with different permits.

Richard Caborn: In light of what the hon. Gentleman said, I would prefer to reflect on the matter and give a precise answer in writing to the Committee.
The hon. Gentleman also asked about one-year permits. They are one-year permits because they are for just one machine. 
I shall reflect on the point about fees and write to members of the Committee to let them know exactly what the interpretation is. 
Question put and agreed to. 
Clause 234 ordered to stand part of the Bill.

Clause 235 - Territorial application

Question proposed, That the clause stand part of the Bill.

Malcolm Moss: I have another quick question. Clause 235(a) says that part 10 applies
''to anything done in relation to a gaming machine which (or any part of which) is situated in Great Britain''.
I am not quite sure how a gaming machine can be partly in this country and partly in another country, although I suppose a computer server might be. Can the Minister clarify whether the provisions refer to a dual server for remote gambling, where one facility is offered over the internet and another by a UK-based application?

Richard Caborn: The provisions apply to gaming software or a server. Part 10 applies to anything done to a gaming machine that is in Great Britain and anything done in Great Britain in relation to a gaming machine. That deliberate distinction means that people in Great Britain manufacturing and supplying gaming machines will need to comply with our best practice, even where those machines are supplied elsewhere in the world. With that explanation, I hope that the clause can stand part of the Bill.
Question put and agreed to. 
Clause 235 ordered to stand part of the Bill.

Clause 236 - Promoting a lottery

Question proposed, That the clause stand part of the Bill.

Nick Hawkins: We have turned to part 11, which deals with lotteries. I have expressed my concerns on behalf of hospice lotteries before and there have been quite a lot of debates about the issue. I want to ask the Minister, first, whether he is absolutely satisfied that there is nothing in the Bill that can damage the important contribution that hospice lotteries successfully make to fundraising.

Bob Russell: The hon. Gentleman twice used the phrase ''hospice lotteries'', but would he confirm that we are talking about lotteries generally, not just those lotteries? Many other voluntary and charitable organisations have similar lotteries.

Nick Hawkins: I am happy to confirm that. I am simply referring to the fact that when I have spoken in the Committee I have been particularly concerned about the hospices that have written to me, not only in my area, but throughout the country. I know that the hon. Gentleman shares my concerns, which have been widely expressed by many members of the Committee. He is of course right that there are lotteries working for many worthwhile causes, not just hospices. However, I strongly support the hospice movement and have worked with it for many years, both before and since coming to the House. It would be helpful if the Minister could give an assurance that nothing in part 11 will in any way damage or add to the expenses of hospices and similar organisations conducting fundraising lotteries.
My second concern is that in the Queen's Speech the Government announced their plans to introduce proposals to change the national lottery. I wonder  whether we are seeing once again a lack of joined-up thinking, which is all too typical of this Government. They are changing the law on lotteries through the Bill, but are at the same time introducing further changes to the national lottery in separate legislation. There was a lot of comment immediately after the Queen's Speech, but the Government's changes to the national lottery—expected in a Bill in the previous Session—have been delayed until now. 
It was originally anticipated, from earlier statements by Ministers, that what turned out to be the Horserace Betting and Olympic Lottery Bill—I dealt with that from the Front Bench for the official Opposition, with my hon. Friend the Member for South-East Cambridgeshire (Mr. Paice)—would also incorporate changes to the national lottery. It was delayed, and the changes will be in the new Bill. Who knows whether that Bill will become law before the anticipated general election? Are the Government wise to be changing the general law on lotteries when they are making changes to the national lottery? 
Labour Members said in opposition, when my party was introducing the national lottery, that money from it should not be used for anything that would otherwise be funded by the taxpayer, but as soon as the Labour Government came to power, they did precisely what they had been suggesting might happen. We have regularly expressed concern from these Benches—

Peter Pike: Order. I do not want us to start discussing the national lottery, which is not relevant to the clause or the Bill.

Nick Hawkins: I abide by your ruling, Mr. Pike, but I wanted to express my concern that part of this legislation, which changes the law on lotteries, should not in any way be used for further depredations on the national lottery. However, I shall not pursue that line any further.
I hope that the Minister can deal with the important issues that I have raised and that this part of the Bill will fit in with whatever the Government introduce with their changes to the national lottery. I hope also that there will not be the same chaos, with the Government's frequent changes and U-turns, that has characterised this legislation.

Don Foster: Although the clause is relatively limited in scope, it is one of a number of clauses that we are going to go through fairly quickly. Rather than speak on each, I shall use this debate as a peg on which to hang for the Minister a reminder of his clear assurance to the Committee about the ticketless lotteries, which, as the hon. Gentleman and my hon. Friend the Member for Colchester (Bob Russell) said, particularly affect hospices and a number of other organisations. Perhaps this is the Minister's opportunity to say whether he has reflected on that assurance and to give any news of the Government's plans. No doubt some amendments will affect this part of the Bill.
I want to ask the Minister a question about definitions, although I am not sure whether it would be more appropriate under schedule 9. Can he explain to the Committee whether something that is often  called a 100 club, a 200 club or a 500 club, which several organisations run, would constitute a lottery under the definitions in this part of the Bill? People are, in effect, buying a number, with a ticket that says what their number is, on a monthly basis. Very often, this takes the same form as a ticketless lottery, so perhaps it will come up in amendments tabled by the Minister. I raise the matter because I am conscious that such fundraising activities take place in the constituencies of a large number of hon. Members who are present. It is important for us to know whether we shall be affected and whether all those organisations, political or otherwise, that run such activities are covered by the legislation.

Richard Caborn: On the question whether we are satisfied that nothing in the Bill can damage hospice lotteries, which was asked by the hon. Member for Surrey Heath, the answer is yes. We are looking at the question of ticketless lotteries and will ensure that those are covered, as I previously assured the Committee.
I shall just dismiss the political rhetoric about the lottery and not go down the route of answering it, although there are good answers to be made. Coming off the back of Budd, there has been a good reception from lotteries for what we have done, because of the protection that charitable lotteries now have and because the relevant charities find it helpful. Our action has been welcomed. 
Whether a 100 club is a lottery depends on circumstances. Those that the hon. Member for Bath (Mr. Foster) described would be lotteries, and indeed always have been. They may be small, private society lotteries, depending on the circumstances. I think we will have to examine that point, because it might affect my constituency as well.

Don Foster: I did say that it might be more appropriate to raise the matter under schedule 9 and I assumed that the Minister might want to say that these matters fit into the category of a private society lottery. Perhaps he will give some thought to the schedule 9 provisions on how a private society lottery can operate, which make it clear that it can be promoted only on the premises of the private society. That means that it would not be possible to approach members of the organisation in their homes to involve them in the lottery. That might cause a problem in the future. The Minister has time to reflect on the issue, so he may not want to refer to it now.

Richard Caborn: I am sure that my officials have heard the hon. Gentleman's remarks with great interest. We shall have an answer when we reach schedule 9.
Question put and agreed to. 
Clause 236 ordered to stand part of the Bill.

Clause 237 - Lottery ticket

Question proposed, That the clause stand part of the Bill.

Malcolm Moss: My remarks follow on from something that the Minister said in giving an assurance to the hon. Member for Bath on ticketless lotteries. Clause 237(1) states:
''For the purposes of this Act a document or article is a lottery ticket if it confers, or can be used to prove, membership of a class for the purpose of the allocation of prizes in a lottery.''
The Minister gave an assurance that all would be well but did not say why, so all the people in the charities lottery sector who have been lobbying us still do not know exactly how they will avoid being caught due to their ticketless method. Perhaps a ''document'', in the definition under subsection (1), becomes a ticket in a way that gets round the problem—I do not know and just raise that as a possibility. 
The charity lottery representatives say that people sign up with a direct debit or banker's order and the money goes in, very much as happens with our 200 clubs. Some strong Conservative associations have 500 clubs. The Liberal Democrats probably have a smaller number—

Don Foster: 50 clubs.

Malcolm Moss: But the same principle applies, in which membership of the club or lottery is the acceptance letter in which people are told, ''Yes, you have been signed up, here is your number, or whatever, and thanks for your donation.'' A different amendment or new clause may be needed on Report, but it would be interesting to have the Minister's response on clause stand part as to whether this is the context in which charity lotteries can obtain the comfort they seek.

Richard Caborn: We will do that. We plan to make it clear through an amendment, if necessary.
On the specific point made about a letter being sent, the acceptance letter is deemed to be a ticket, but we will clarify that in the amendments that we introduce. I hear what has been said and will reflect on it.

Don Foster: Just so that it is clear on the record, I think it is already accepted that the receipt of the letter is equivalent to the receipt of the ticket. However, the letter effectively provides for a series of tickets over a period of time and the issue is whether there is a need for a separate ticket for each draw that takes place, or whether the letter, in some clever linguistic way, can be deemed to be a multiple ticket issued simultaneously.

Richard Caborn: We will reflect on that matter and provide for it in an amendment.
While I am on my feet, I shall answer the question about 100 clubs operating on more than one premises. A 100 club could be a small society lottery under schedule 9, and small society lotteries do not have to operate on one set of premises. 
Question put and agreed to. 
Clause 237 ordered to stand part of the Bill. 
Clauses 238 and 239 ordered to stand part of the Bill.

Clause 240 - Rollover

Question proposed, That the clause stand part of the Bill.

Malcolm Moss: I refer to something that I came across in the Joint Committee's report, which refers to rollover:
''It is unclear whether subscription lotteries (e.g. clubs where the participants are the same week after week and there are draws each week), would be considered to be 'rollovers' and thus treated as a single lottery.''
I raise that point because it relates to the clause.

Richard Caborn: Clause 240 defines the meaning of a rollover. A rollover takes place when an unallocated prize from one lottery is carried forward to another. Even if a lottery has multiple draws where the class or persons eligible for the prizes remain the same—the arrangements for the lottery mean that they must remain the same—the draws are regarded as part of the same lottery. Where prizes from previous draws are carried forward for the next prize in the same lottery, a rollover will not occur. When the class of persons eligible for the prizes changes, a new lottery will begin. The answer to the question whether a subscription lottery would be considered a rollover is no.
Question put and agreed to. 
Clause 240 ordered to stand part of the Bill. 
Clause 241 ordered to stand part of the Bill.

Clause 242 - Promotion of lottery

Question proposed, That the clause stand part of the Bill.

Eric Illsley: I have a brief question for my right hon. Friend in relation to the offence of promotion of a lottery. Clause 236 states that
''a person promotes a lottery if he . . . sells or supplies a lottery ticket.''
I wonder whether a person commits an offence of promoting a lottery if he buys a lottery ticket and sells it on to someone else. Is he then guilty of promoting a lottery? Since the national lottery was established, I know that there have been cases of people claiming prizes under a ticket bought for them by someone else, when the ticket has been endorsed on the back. There appears to be no exemption in the clause covering the resale of one lottery ticket or even several tickets to further a lottery distribution. I will just keep talking until the answer arrives. While I am on my feet, I can stretch my legs a bit. It occurs to me that we are creating an offence without any qualification of what constitutes the sale or resale of a lottery ticket.

Richard Caborn: Is a person who buys a ticket and then sells it on guilty of the offence? Yes, but we have to be a little careful; it would depend on the surrounding circumstances. For the superficial cases presented by my hon. Friend, the answer would be yes, but I add a caveat that there could be circumstances in which that would not be the case.

Eric Illsley: That is interesting, because I could have been guilty of that offence. Once, I was sitting in a restaurant at 8 o'clock on a Saturday evening, which is when the lottery results are announced, when my  mobile phone rang. The person who I was with assumed that somebody was ringing to tell me that I had won on the national lottery, whereupon he offered to buy my ticket as a gamble, because we did not know if I had won £10, £50 or £1 million. He said, ''Right, I'll buy the ticket from you; I will offer you a figure, and you sell your proposed winnings.'' It was a gamble—a bet. It may sound slightly unusual, but there is betting on the results of a lottery or selling of tickets in that way, and the measure will create a conscionable number of offences.

Richard Caborn: That is not my interpretation; in the situation that my hon. Friend describes, the draw had already taken place, so the gamble was on whether he believed that he had won £10 or £1 million. That was a decision that he took, and was nothing to do with the lottery. It was a secondary issue after the lottery had taken place.
What happened? My hon. Friend should not keep the Committee in suspense.

Eric Illsley: I won a million; that is why I am still here—[Laughter.]
Question put and agreed to. 
Clause 242 ordered to stand part of the Bill.

Schedule 9 - Exempt lotteries

Malcolm Moss: I beg to move amendment No. 319, in schedule 9, page 169, line 24, at end insert—
'(4A) The prescribed sum referred to in paragraphs 3 and 4 shall be determined only after consultation with parties representing those who will be affected by such determination and shall be the subject of periodic review.'. 
Paragraphs 3 and 4 deal with deductions from lottery proceeds, particularly for the cost of prizes and for costs incurred in organising the lottery. They provide that a sum will be prescribed for both prize and organisation costs, irrespective of their actual cost. Such a determination could fundamentally affect the way in which incidental, non-commercial lotteries are run, and could endanger valuable revenue in that sector. We seek to ensure that there will be proper consultation so that a realistic limit is placed on deductions for prizes and incurred costs, and that the limit will be reviewed periodically.

Richard Caborn: I understand the reason behind the amendment. I fully expect the Government to consult interested parties such as the Lotteries Council before prescribing the amount referred to in paragraph 4. I am happy to give a pledge to that effect, but do not think it necessary to place a duty of consultation in the Bill. I hope that, with that assurance, the hon. Gentleman will withdraw the amendment.

Malcolm Moss: On the basis of the Minister's assurance, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn. 
Amendments made: No. 172, in schedule 9, page 178, line 20, at end insert— 
'( ) In relation to registration in Scotland— 
(a) sub-paragraph (1)(b) shall have effect as if the reference to a magistrate's court were a reference to a sheriff whose sheriffdom is wholly or partly within the area of the local authority against whose decision the appeal is brought, 
(b) sub-paragraph (2)(a) and (b) shall not have effect, and 
(c) sub-paragraph (3) shall have effect as if the reference to a magistrate's court were a reference to the sheriff.'. 
'( ) In relation to registration in Scotland— 
(a) sub-paragraph (1)(b) shall have effect as if the reference to a magistrate's court were a reference to a sheriff whose sheriffdom is wholly or partly within the area of the local authority against whose decision the appeal is brought, 
(b) sub-paragraph (2)(a) and (b) shall not have effect, and 
(c) sub-paragraph (3) shall have effect as if the reference to a magistrate's court were a reference to the sheriff.'. 
No. 173, in schedule 9, page 179, line 18, at end insert 
'except that, in the following provisions, it means prescribed by the Scottish Ministers by regulations— 
(a) in paragraph 43(2)(d), where the application is made to a local authority in Scotland, 
(b) in paragraph 47(1), where the local authority giving notice is in Scotland, and 
(c) in paragraph 55(2)(b), where the registering local authority is in Scotland.'. 
'except that, in the following provisions, it means prescribed by the Scottish Ministers by regulations— 
(a) in paragraph 43(2)(d), where the application is made to a local authority in Scotland, 
(b) in paragraph 47(1), where the local authority giving notice is in Scotland, and 
(c) in paragraph 55(2)(b), where the registering local authority is in Scotland.'. 
—[Mr. Caborn]

Richard Caborn: I beg to move amendment No. 371, in schedule 9, page 180, line 7, at end insert—
'3A An order under subsection (3) may, in particular, make provision— 
(a) restricting the number of lotteries that may be promoted on behalf of a person wholly or partly within a specified period; 
(b) prescribing a minimum interval between activity in connection with one lottery promoted on behalf of a person and activity in connection with another lottery promoted on behalf of that person.'. 
The amendment will ensure that the Secretary of State has the power to make regulations to restrict the number of exempt lotteries that may be promoted in any period, or to prescribe a minimum interval between two exempt lotteries promoted on behalf of any person. 
The Lotteries and Amusements Act 1976 contains similar powers to restrict the frequency of all society and local authority lotteries. For the most part, in the Bill, conditions attached to the lottery operating licence will control local authority lotteries and large society lotteries. The gambling commission will issue licences for those two types of lottery. It is important, however, that the Secretary of State retains the means to prevent the proliferation of exempt lotteries, should it be necessary. Exempt lotteries do not require a licence, so small society lotteries will have to be registered with the local authority. 
Amendment agreed to. 
Question proposed, That this schedule, as amended, be the Ninth schedule to the Bill.

Nick Hawkins: I question the requirement for small society lotteries to register with local authorities. From my experience with hospice lotteries—one operates in my constituency—I am very aware that they can operate in a range of local authority areas. From the drafting of part 5 of schedule 9, which deals with local authority registration, it seems that as long as the lottery is registered with one local authority, it should not matter which one. Having registered with the local authority, however, the matter needs to be referred to the gambling commission. That seems to be a unnecessary further expansion of bureaucracy.
I put it to the Minister that the Government are constantly loading more burdens on to local authorities, particularly small borough councils. Every time I talk to the senior officers of Surrey Heath borough council—it is entirely within my constituency, which is also partly covered by Guildford borough council—it says that it is constantly having new administrative and bureaucratic burdens landed on it by the Government, but they never provide it with any extra money to enable it to discharge those new functions. 
If a hospice lottery or any other small lottery has to register—it will obviously have to do so under the Bill—it will have to register with every borough council and district council, as well as with the bigger local authorities that might be able to absorb the costs more easily. Those councils will have to start employing new people just to deal with lottery registrations, or they may create a new department to deal with them. Where is the money to come from? 
Would it not be much more sensible, given that the Government are to set up a new thing called the gambling commission, which is to be centrally funded, if those small lotteries went straight to the commission? The commission will have to be notified under part 5 of the schedule in any case. I do not see the need for what I think will be a costly and overly bureaucratic exercise. Why cannot the whole thing just go straight to the commission? It will have to create its own records, and the Government would then fund registration out of general taxpayer revenue. It is something for which the Government should take responsibility, as they are setting up the system. 
I hope that the Minister will give a firm undertaking—he may already have received authority from the Chancellor of the Exchequer—that, for every council in the land, the Department for Culture, Media and Sport can hand over some of the money that it gets from the Treasury every year; or that an special extra bit of the annual local government settlement will provide funding for that new bureaucracy. If not, this will be yet another example of the Government's constant and wholly unnecessary additions to bureaucracy, to no good purpose. Why duplicate the work? The registrations will end up with the commission, so why not send them there from the word go?

Don Foster: I gave warning to the Minister that I wanted to talk about the 50 club—or the 100 club, the 200 club or the 500 club, depending on the political party or other organisation running it. The Minister  implied earlier that in some, but not all, circumstances a local constituency association lottery might constitute a private society lottery. I hope that we shall now have some clear explanation as to whether a private society is defined by the number of members it has, by how secretive it is or whatever. It is important that we know; that will have a bearing on the future, not only for many of us but, more importantly, for the many charitable and other organisations that run such activities.
Can the Minister explain whether I have made a mistake in my understanding of paragraph 14(1) in respect of private lotteries? It reads: 
''No advertisement for a private society lottery may be—(a) displayed or distributed except on the society premises, or (b) sent to any other premises.''
Am I right in interpreting that to mean that if Bath Liberal Democrat association runs a 200 club, it will not be allowed to send a flyer advertising the existence of its successful activity to its members, but that they will be able to find out about it only by means of an advertisement posted on premises owned by the association? That cannot be what is intended, but it is certainly the common-sense reading of the Bill. 
While I am on the subject of common-sense readings, may I ask the Minister to reflect on paragraph 56(3) in part 5 of the schedule? Rightly, in my view, it says that if various organisations are to request documents from the local authority, that authority shall not make an unreasonable charge for them. However, it goes on to say that 
''the authority may include a reasonable share of expenditure which is referable only indirectly to the provision of that service.''
That strikes me as a load of gobbledegook, but I assume that it refers to a share of the costs of the administration, such as the salary of the chief executive and the local solicitor. Perhaps the Minister will confirm that. 
Thirdly, I would say gently to the Minister that at the beginning of part 5 we come back to our old friends the definitions of different councils. Despite all his reassurances that he would send me a letter explaining whether Bath and North East Somerset unitary authority is covered by the definitions earlier in the Bill which are repeated in paragraph 42, no such letter has yet reached me. I do not know whether other Committee members have received such assurances.

Nick Hawkins: The hon. Gentleman raises an important point. He will recall that a number of us joined him in seeking assurances about local authorities.
Will the hon. Gentleman also bear it in mind that the Minister told me as recently as Tuesday of this week, in response to a point that I made, that what the Government are introducing has been supported by the British Beer and Pub Association? Then, when I went to a reception held by the all-party group on beer last night and spoke to senior people from that association, I found that they completely disagree with that. I will come back to the point when we discuss licensing, but I am afraid that we are starting to reach the conclusion—I think that the hon.  Gentleman would agree—that we simply cannot place much reliance on what the Minister has said.

Richard Caborn: On a point of order, Mr. Pike. When I give information out in this Committee, it is given genuinely. If anybody wants to challenge what I have said, it should not be on the basis of what happened at a function on the Terrace of the House of Commons when people have had a drink. That is totally unacceptable, and I expect the comment to be withdrawn. If not, the hon. Gentleman should provide evidence to me that what I have said is wrong.

Don Foster: I give way to the hon. Gentleman.

Nick Hawkins: I followed up the conversation that I had last night with the people from the British Beer and Pub Association, and they gave me a briefing and confirmed that what the Minister said about the association working with the Government and agreeing with their proposals was wrong. We will come back to the point this afternoon and if the Minister wants me to, I can read out all the association's disagreements with the Government.

Don Foster: I give way to the Minister.

Richard Caborn: I am not going to have my integrity put on the line by Opposition Members. What I said was wholly true, and when Members bring the integrity of a Minister of the Crown into question, I expect them to tell me who said what and about what specifically. The remark was totally unacceptable.

Don Foster: I give way again to the hon. Gentleman.

Nick Hawkins: I suggest to the Minister that we return to the issue when we deal with licensing—we will thrash it out then. My position is absolutely clear. If I am briefed by members of a trade association, not only at a reception in the House but in a written briefing the following morning, I am entitled to put forward its concerns.

Don Foster: I give way.

Richard Caborn: I want a withdrawal of the comment that I gave wrong information in my position as a Minister in this Committee. If substantive evidence can be brought forward, that is fine—I will answer the allegations. The integrity of a Minister is being brought into disrepute by the hon. Gentleman's statements.

Peter Pike: I call Mr. Hawkins.

Nick Hawkins: I am simply stating what I have been briefed about. The Minister and I clearly disagree. We will come back to it when we deal with the substance of the licensing issue.

Richard Caborn: That is not what was said.

Nick Hawkins: We may need to refer to Hansard to find out exactly what the Minister said. What I am saying is that the British Beer and Pub Association has briefed me that it does not agree with the Government in the way that the Minister claimed.

Richard Caborn: The words used were that we cannot believe what the Minister has said. That is unacceptable, and I want them withdrawn.

Peter Pike: I think that the allegation in the final part of what the hon. Member for Surrey Heath initially said contained an improper implication.

Nick Hawkins: I certainly withdraw the implication, but the issue remains.

Peter Pike: I call Mr. Foster.

Don Foster: I gave way many times in that discussion. Before the Minister intervened, I was about to say that I did not agree with the hon. Member for Surrey Heath in his assertions. I am happy to put it on record that whatever disagreements I have with the Government about certain aspects of the Bill, the Minister has sought to accommodate the concerns expressed in Committee. When he has seen it as possible, he has been prepared to make changes.
The hon. Gentleman is right to say that concerns continue to be expressed about the Bill by a number of organisations, of which the British Beer and Pub Association is one. Those issues will be more appropriately raised at a later stage. However, from our side of the argument, we feel that we can rely on the Minister and that when he makes an assurance, he will deliver on it. The point that I was making is that although I am totally confident that he will deliver on his assurances, I have not yet seen that in respect of the definition and I want to see it. I hope that we will get some progress. 
I was trying to make five brief points, which have been slightly hijacked. My last point will now seem so mundane and trivial that I am not sure that it is worth bothering with. Nevertheless, paragraph 55 of schedule 9 states that the annual fee 
''shall be of the prescribed amount''.
Can I take it—I do not see where the legislation ties in with those things that the Secretary of State will make regulations for—that this will be included in the list of fees, which will be the basis of regulations by the Secretary of State, and that individual local authorities will not determine their own fate?

Malcolm Moss: On a point of order, Mr. Pike. I want to help the Committee, my hon. Friend the Member for Surrey Heath and the Minister. I, too, have had representations from the BBPA. What we have is simply a misinterpretation. There has been consultation between the Department and the association. We accept that and the Minister faithfully reported that the consultation had taken place, and the association expressed its concerns about certain aspects. But that was some time ago. We are told that the proposals that the Government have brought forward in the amendments were not in consulted upon in detail. That is what my hon. Friend reported faithfully from last night. It does not impugn the Minister's integrity; it is simply a misinterpretation of events.

Peter Pike: That is not a point of order.
Mr. Hawkins rose—

Peter Pike: I have ruled that the phrase that Mr. Hawkins used right at the end of his remarks bordered on the unparliamentary. He has withdrawn it, so we should now make progress.

Richard Caborn: The charges that the hon. Member for Surrey Heath said might be incurred are covered in paragraph 55 on the annual fees. The local authority must send a copy of the registration to the commission and a fee can then be charged. Paragraph 56 allows for a charge for overheads generally. The local authorities can allocate a proportion of the overheads to fees when providing the services described in paragraph 56. So it is not simply the cost of sending out particular letters: staff costs can be factored in too.
The hon. Member for Bath asked about advertising. A 100 club will not be a private society lottery if it is set up for the purpose of gambling. It will not therefore be able to send out advertisements. However, a 100 club might be a small society lottery so it could send out such promotions.

Don Foster: It is a private society lottery, not a small society lottery, but I do not yet understand the definition of a private society. I gave the example of the Bath Liberal Democrat association which, I can assure the Minister, is not set up for the purposes of gambling although some might say that we border on it when we come to elections. As an incidental part of its fund-raising activities, it operates a 200 club. I am breaching all sorts of confidentialities. Would that fall under the definition of a private society lottery? If it does not, I need to know what does.

Richard Caborn: If it is a small society lottery, which it seems to be, it can advertise. The question was whether it can advertise, and the answer is yes if it is a small society lottery.

Don Foster: The advertising for a private society lottery is covered in paragraph 14(1), which effectively states that it can advertise its activities only in the society premises. It makes it clear that it cannot send those advertisements to other premises. Therefore a private society—in this case, the Bath Liberal Democrats association—cannot send letters to its members to encourage them to join the 200 club. I simply need clarification of whether that is what the provision means, because, if it does, it is a load of nonsense. We can debate that in due course, but first I need to know whether I have understood the provision correctly.

Richard Caborn: We are saying that the arrangement the hon. Gentleman describes is a private lottery run by a small society, not a private society lottery.

Don Foster: So?

Richard Caborn: Therefore, the association is well within its rights to advertise and send letters to its members.
Schedule 9, as amended, agreed to. 
Clauses 243 to 247 ordered to stand part of the Bill.

Clause 248 - Preventing repetitive play

Question proposed, That the clause stand part of the Bill.

Malcolm Moss: The clause refers to the repetitive playing of lotteries and the effect that conditions attached to lottery operating licences may have on it. The  Government were, of course, sensible to withdraw their original plan to prohibit lotteries from taking place within 24 hours. The scrutiny Committee considered the issue and made recommendations, which the Government accepted. They took the relevant clause out of the draft Bill, so we do not have that problem, which would have caused difficulties for lotteries such as those held at half-time at football matches.
Members of the Lotteries Council are, however, still a little concerned about this clause, which gives the Secretary of State the power to make regulations on repetitive play. Obviously, regulations could be introduced at a later date that would have a serious impact on lotteries, dramatically affecting their profitability and their raison d'être. We have been asked to put it to the Government that the Secretary of State is again being given a potentially very severe power, which could have important ramifications for operators. They want an assurance from the Government that full consultation will take place before any regulations are laid. They want to know whether there will be consultation with the gambling commission—I suspect that the Minister will confirm that—before the Secretary of State brings any secondary legislation before the House. 
It is important for operators to be clear about such issues, because they do not know what will happen in the future. The clause could have a serious effect, and they want a steer from the Minister—an assurance that consultation will take place and that any measures that are taken will not be so draconian as to render their operations ineffective and unprofitable.

Nick Hawkins: I share the concerns that my hon. Friend has expressed on behalf of the Lotteries Council, but I would go a little further. I am not convinced of the necessity for such regulations. Why should a Government want the power to limit people's ability to enter a number of lotteries? Subsection (2) is one of the most extraordinary examples of the nanny state approach that the Government are adopting in so many aspects of our national life, such as smoking and drinking. It is bizarre that the Government are saying that the Secretary of State will bring in regulations at some point in the future to reduce temptation for a person to enter a number of lotteries in succession, and that the regulations can be introduced only if they reduce temptation and limit opportunity.
If one wants a paradigm of everything wrong with this Labour Government and every reason why the Conservatives oppose them, it is because the Government think it their job to limit opportunity. They also seem to think that on the matter of reducing temptation they should take over the position traditionally held in society by religion. It is absolutely wrong for them to do that. 
The Minister will probably say that they are trying to stop problem gambling, but I do not accept that people entering lotteries is problem gambling. One of the great success stories of the previous Conservative Government was the introduction of the national lottery. This provision does not affect that, but the  success of the national lottery depends on players playing repetitively week by week, as I do myself—I buy an eight-week collective ticket for the national lottery and renew it when the eight weeks are up. I have won the odd £10 here and £20 there and am probably making a loss, but the attraction for all players of the lottery is the hope of a big win one day. It will probably never happen to me, but I support the concept. It is bizarre that the Government are seeking to reduce temptation and limit opportunity.

Tony Banks: I would be more convinced by the hon. Gentleman's argument if I had not heard him argue earlier for limiting the number of casinos, which is a manoeuvre similar to this provision. I object to the way that the lottery has developed. With people using the same set of numbers every week, the more games are introduced using numbers, the more people will be sucked in, because the worst thing that could happen to the hon. Gentleman and me would be for our numbers to come up in a draw that we had not entered. That would deprive us of the chance to take off to that Caribbean island, which is what we would do—not together, I hasten to add—if we won money.

Nick Hawkins: I would be happy if the hon. Gentleman wanted to fund a joint trip to a Caribbean island out of his lottery winnings. I have always enjoyed his company on a purely fraternal, cross-party basis, as he knows.
The hon. Gentleman is mistaken or may have misremembered. When we debated casinos, I was probably the person on these Benches whose opinion was closest to his view of a total free-for-all, free market opportunity. Unlike my hon. Friend the Member for Bromsgrove, I was concerned to ensure that however many casinos we had, we should not lose the regenerative effect. The hon. Member for Blackpool, North and Fleetwood (Mrs. Humble) and I argued that we wanted to ensure that run-down resorts got regeneration. I think that the hon. Gentleman was alone in arguing for a complete free-for-all. I was in favour of changing Government policy to avoid run-down, seaside resorts, such as Blackpool, not getting casinos because of an area such as the north-west being swamped with casinos set up elsewhere. I was not arguing the point that he suggests, so I cannot be accused of inconsistency. However, I take his point and hope that I never forget to renew my eight-week ticket and suffer the dreadful embarrassment of seeing my numbers come up when I have not entered a draw.

Malcolm Moss: I will try to help my hon. Friend. The hon. Member for West Ham (Mr. Banks) never argued against a cap. He certainly had many arguments against the number eight, which were illuminating and hilarious, but my understanding of his position is that he does not care how many casinos there are, as long as West Ham gets one.

Nick Hawkins: I am grateful, as always, to my hon. Friend for his help. Perhaps the hon. Member for West Ham will remind us, but I understood him to be the most free-market of all on the Labour Benches. I remember my hon. Friend the Member for South-West Hertfordshire (Mr. Page) saying how amazed he  was, just before his retirement, to be overtaken on the right by the ultra free-market views of the hon. Gentleman.

Tony Banks: I was probably more libertarian than anyone on the Conservative Benches in this Committee, because I was not expecting there somehow to be an enormous proliferation of casinos. I wanted matters taken care of through the planning process, but we will return to this debate. I do not mind being accused of being a neo-fascist.

Peter Pike: Order. Let us return to the clause.

Nick Hawkins: I must apologise, because I was tempted away from the subject, as has often been the experience of many hon. Members down the years, by the wit and humour of the hon. Gentleman. I have made my point. It is philosophical, but valid in light of the way in which the clause and, in particular, subsection (2) are drafted.

Richard Caborn: The hon. Gentleman has accused me of massacring the English language. May I gently remind him that ''forgetting'' is probably a better way of expressing himself than ''misremembering''? I also give him the reassurance that consultation will take place; there is no doubt about that.
May I put on record in this stand part debate the fact that the clause allows the Secretary of State to make regulations to reduce or limit the repetitive play of lotteries? That applies where people have the opportunity to enter a number of lotteries in succession. The Government consider there to be a need for this provision, as we have real concerns about fast-draw lotteries, whether carried out by those running society or charitable lotteries, or as part of the national lottery. 
The Budd report looked at the issue of fast-draw lotteries and concluded that they should be strictly controlled. It saw a particular problem with the possibility of more frequent lotteries in social environments, such as pubs, bars or cafes, which are not of course premises to which people go primarily to gamble. The Government share that concern. We recognise that the sale of lottery tickets through fast-draw lotteries may well increase lottery revenues. However, such games offer the opportunity to play repeatedly and rapidly and to chase losses, particularly  when the minimum age for lottery play will be 16, as an exception to the general age limit of 18. Therefore, in line with the prudent approach adopted for gaming machines, the Government are minded that regulations under this clause should introduce a limit of one lottery an hour for lotteries promoted in circumstances that appear to encourage or facilitate repetitive play. 
The Committee may also find it helpful to know that the Government propose to introduce similar restrictions on lotteries promoted under the national lottery.

Nick Hawkins: Will the Minister give way?

Richard Caborn: No, there is a lack of time.
Under the clause, the Secretary of State may attach a condition to lottery operating licences, make the gambling commission attach a specified condition to a lottery operating licence and add additional specified conditions to the conditions applicable to exempt lotteries. The Secretary of State's powers must be directed at reducing the temptation or limiting the opportunity for a person to enter lotteries repetitively, and that is what we are minded to do. 
By way of explanation, the speed at which those lotteries can run is, in a pub, every 30 seconds. That is a repetitive lottery, and we believe that it would lead to real problem gambling.

Nick Hawkins: I now understand why the Minister would not give way earlier. Would it not be easier just to take the powers to ban fast-draw lotteries, rather than take the wide powers over all lotteries as drafted in subsections (1) and (2)?

Richard Caborn: No, because we have tried to future-proof the provisions, and we are not quite sure how they will be adopted in the future. We therefore believe that the wording protects against problem gambling. I do not think that there should be any disagreement about that.

Malcolm Moss: The Minister referred to an interval of one hour between successive plays. Is that in the Bill?
It being twenty-five minutes past Eleven o'clock, The Chairman adjourned the Committee without Question put, pursuant to the Standing Order. 
Adjourned till this day at half-past Two o'clock.